Insurers Target Medicare Advantage HMOs for Acquisition

September 7, 2011

Will 2011 be known as the year big insurers gobbled up Medicare Advantage companies? According to a recent article in HealthLeaders Media, by Margaret Tocknell, it just might. Tacknell speculates that the MA HMO acquisitions by HealthSpring, WellPoint and Humana are just the beginning as MA growth continues to climb, driven by companies transitioning retirees from employee-sponsored plans to MA plans, and increasing numbers of baby boomers reaching retirement age. To point out just how fast Medicare Advantage is growing, the article sites data from the Kaiser Family Foundation indicating enrollment in MA plans has more than doubled in recent years, growing from 5.3 million in 2005 to 11.1 million in 2010. Trocknell writes:

. . . competition is heating up as well-financed players such as Aetna, Humana, WellPoint and UnitedHealth look to increase their share of the market. James [Sarah James, health insurance analyst with Wedbush Securities] expects to see more acquisitions of smaller Medicare Advantage companies as healthcare reform kicks in and economies of scale become even more important. “The Medicare Advantage market is very fragmented and it’s getting more difficult to be a small player.”

Read the full article: “Insurers Eye Medicare Advantage Acquistions.”

Visit Extend Health — the nation’s largest private Medicare exchange.

One Response to “Insurers Target Medicare Advantage HMOs for Acquisition”

  1. […] Insurers Target Medicare Advantage HMOs for Acquisition […]

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